Corporate Governance

Board Committees

The Nomination and Governance Committee

The Nomination and Governance Committee (NGC) judiciously passes upon the qualifications of nominees to the board, and makes sure that a board election will result in a mix of proficient directors, each of whom will be able to add value and bring prudent judgment to the board of directors. The Nomination and Governance Committee is composed of three members of the Board, one of whom is an Independent Director.

The committee is presently composed of:

Chairman Federico R. Lopez,

Richard B. Tantoco, and

Alicia Rita L. Morales

The NGC has the following duties and responsibilities:

Review and evaluate the qualifications of all persons nominated to the Board and other appointments that require Board approval;

Ensure, through a managed and effective system consistent with the Corporation’s By-Laws, that each Board election shall result in a mix of proficient Directors, each of whom shall be able to add value and bring prudent judgment to the Board;

Assess the effectiveness of the Board’s processes and procedures in the election or replacement of Directors;

Review the recommendations of the Compliance Officer in relation to the Corporation’s Manual on Corporate Governance as well as other corporate governance rules and regulations and endorse the same to the Board for its approval;

Review, as may be necessary, the charters of all Board committees and recommend any changes to the Board for its approval; and

Such other tasks or duties as may be requested or delegated by the Board.

The Compensation and Remuneration Committee (CRC) is composed of the Chairman of the board and two members, one of whom is an Independent Director. The committee has powers and functions over the compensation and remuneration of the corporate officers other than the Chairman of the Board, whose compensation and remuneration is determined by the President and two directors, one of whom is an Independent Director. The committee ensures that the compensation of the company’s directors and officers is consistent with the company’s culture, strategy, and the business environment in which it operates.

The committee is composed of:

Independent Director Cielito F. Habito as chairman,

Federico R. Lopez, and

Peter D. Garrucho Jr.

The CRC has the following duties and responsibilities:

Designate the amount of remuneration which shall be in a level sufficient to attract and retain Directors and officers who are needed to run the Corporation successfully;

Review the Corporation’s human resources development or personnel handbook to strengthen provisions on conflict of interest, policies on salaries and benefits, and directives on promotion and career advancement; and

Such other tasks or duties as may be requested or delegated by the Board.

The Audit Committee is composed of four members of the Board, three of whom are Independent Directors (with the chairman of the committee required to be an Independent Director). The members of the Audit Committee should preferably have accounting and finance backgrounds.

The Audit Committee members are:

Jaime I. Ayala – Chairman

Peter D. Garrucho, Jr.

Dr. Cielito F. Habito

Alicia Rita L. Morales

The Audit Committee shall have the following powers and functions:

to assist the board in the performance of its oversight responsibility for the financial reporting process, system of internal control, audit process, and monitoring of compliance with applicable laws, rules and regulations;

to provide oversight over management’s activities in managing credit,

market, liquidity, operational, legal and other risks of the corporation;

to review the annual internal audit plan to ensure its conformity with the objectives of the corporation;

Prior to the commencement of the audit, to discuss with the external auditor the nature, scope and expenses of the audit, and ensure proper coordination if more than one audit firm is involved in the activity to secure proper coverage and minimize duplication of efforts;

to organize an internal audit department and consider the appointment of an independent internal auditor and the terms and conditions of its engagement and removal;

to monitor and evaluate the adequacy and effectiveness of the company’s internal control system, including financial reporting control and information technology security;

to review the reports submitted by the internal and external auditors;

to review the quarterly, half-year and annual financial statements before their submission to the board, with particular focus on the following:

any change/s in accounting policies and practices;

major judgmental areas;

significant adjustments resulting from the audit;

going concern assumptions;

compliance with accounting standards; and

compliance with tax, legal and regulatory requirements;

to evaluate and determine the non-audit work, if any, of the external auditor, and review periodically the non-audit fees paid to the external auditor;

to establish and identify the reporting line of the internal auditor to enable him to properly fulfill his duties and responsibilities;

to check all financial reports of the corporation against its compliance with both the internal financial management handbook and pertinent accounting standards, including regulatory requirements;

to perform interface functions with the internal and external auditors; and

to ensure the establishment of a transparent financial management controls system that aims to ensure the integrity of the system.

The Audit Committee may request information, data and clarification from the officers of the corporation in the performance of their duties and responsibilities.

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